The rainbow colored white-and-blue

Today it is difficult to distinguish between a locally made
product and one made abroad
by Orna Coussin
Ha'aretz, 11 April 2002

Goldstar or Tuborg? The advertising campaign "Israel buys blue and white," currently being aired on radio and television, is urging Israelis to buy locally made products. The average customer would understand from them that it is better to purchase Goldstar, an Israeli beer, than the Danish Tuborg. In that way, unemployment in Israel can be minimized.

However, it just so happens that both beer brands - including the one identified with Denmark - are made in Israel. Tal Rabban, the director of marketing for Beer Breweries Israel, notes that the Ashkelon plant, where Carlsberg, Tuborg and Prigat products are made, employs some 200 Israelis.

Sometimes it seems that there really is nothing new under the sun. "Let us stick to Israeli-made products, it's what a smart country does," called Golda Meir in April 25 years ago. At the time, she headed the Public Council to Encourage the Purchase of Israeli Products. Even then, as today, they talked about the fact that Israeli youth hanker for imported goods, a tendency that ostensibly harms domestic industry.

This subject comes up for discussion at least once in ten years. In February, 1984, for example, it was Gideon Patt, then minister of industry, who called upon consumers to opt for local products. He also demanded that government agencies - the army, hospitals, government companies - all buy "blue and white."

That is exactly what current Minister of Industry and Trade Dalia Itzik is demanding too. "Hospital towels, and even national flags and a large proportion of army uniforms are currently ordered from the Far East," says Itzik. "If the gap in prices is something we can live with, government companies should grant priority to Israeli products." But, she notes, "If production in Israel is too expensive, there is no choice and government companies will continue to prefer cheaper foreign products and I cannot force them to buy more expensive items." Past experience proves that future ministers of industry will come out with similar campaigns in the future as well.

Blue and void

However, in a certain sense, some things have fundamentally changed. In an era of brand names, the concept of "blue and white" is almost void of meaning. Consumers would have to make a special effort to discover which products are really made in Israel. Additionally, there is no guarantee that purchasing an Israeli brand name will benefit Israeli workers in any way.

In the shops of the Israeli clothing brand Golf, for example, one may find shirts sewn in China, tank tops from India and slacks from Turkey.

In Polgat stores, an Israeli men's clothing brand, suits made in Portugal are hanging on the rack. A tour of the nearby shop selling the Israeli brand of Castro will reveal white blouses from India, a colorful dress and tank top from China and one pair of white trousers from Israel. Very few Israeli workers are involved in the manufacturing process of the most well-known Israeli brands.

And while we are at it, how should we choose undergarments? A number of Israeli products are manufactured under the brand of Delta, but a fair proportion of them is sewn in Turkey. Triumph, on the other hand, an international brassieres brand, has two factories in Israel, one in Be'er Sheva and the other in Jerusalem, and they employ about 450 workers (mostly women from Arab villages and new immigrants from the former Soviet Union).

But the Triumph department of the Mashbir Latzarhan does not carry a single bra made in Israel. One is from Hungary, another from Portugal, along with bras from Greece, Austria, Vietnam and Thailand.

Yisrael Romess, Triumph's director of marketing in Israel, explains that in recent years, the two Israeli factories manufacture brassieres only for the British chain Marks & Spencer. "We bring foreign currency into the country," he says. "That too is important."

The picture is similarly complex in other areas. For example, in the food industry, it may be understood from the campaign to buy locally made products that we should prefer products made by Israeli companies to those made by competitors abroad. That would mean that we should leave on the shelf products such as Rombouts filter coffee, taking Elite mocha filter instead. However, both products are made in Belgium and consequently, there is no difference whatever as far as supporting Israeli workers is concerned.

L'Oreal Ha'emek

Take another example. Shampoo brands from Europe and the United States, such as Dove, L'Oreal-Paris, Nivea, Pantene and Finesse, are manufactured in Israeli plants in Migdal Ha'emek, Kiryat Ata and Karmiel. However, other products made by the same companies, including body lotions, liquid soaps and face creams, are manufactured in a wide variety of countries including France, Italy, Mexico and the United States. It may be concluded then that the brand - the name of the company stamped on the packaging - says nothing about the country of origin.

Meir Barel of the Manufacturers' Association reports that the association will soon act to mark products with a special blue-white label in order to help identify those products that are actually made in Israel. The Israeli flag will be stamped onto products that are entirely made in Israel as well as on "items that have been brought to Israel in the form of raw products and undergo processing or change in Israel that give the product an added value of 40 percent or more."

This refers to products that Israeli employees process and their wages represent at least 40 percent of their cost. An example of this would be furniture made from wood imported to Israel, perfumes made from imported essences and clothing made from imported materials.

Barel notes that there are very few industries today in which one may find products that are entirely made in Israel - that is which were made by Israeli workers from A to Z. Among them are plastic products, high-tech products and a long list of food products. On the other hand, says Barel, "in the textile industry, there are very few products that are purely Israeli.

In area of households, dishes, cutlery, glasses and china - today almost everything is imported. There are hardly any toys made in Israel (there are box games, but no toys, such as dolls, teddy bears and balls), cars have not been made in Israel for ages and very few electrical appliances, with the exception of refrigerators, are made in Israel and today even a large proportion of the ceramic tiles and bathroom fixtures for construction are imported."

Minister Dalia Itzik is furious at the fact that "imports to the tune of $49 million a year is 50 percent of the local raw product," and she maintains that this figure must change. She is convinced that "In recent years something has happened to Israeli consumers. They have started to blindly prefer imports," and she wants unruly customers to "start giving an opportunity to local products, to see if they are good," just as economic leaders before her have requested.

Fear of exposure

However, in the times of Golda Meir, Gideon Patt and their predecessors, there was still a lively debate going on about the issue of exposure - opening the local market up to competition with foreign products. In the 1960s and 1970s, the press reported every government decision to expose yet another area of products to competitive imports. Today, on the other hand, no one is even trying to doubt the extent that globalization - free trade, crossing boundaries and nationalities, the canceling of any local protection of domestic products - is a positive and desirable phenomenon.

Dalia Itzik says, "There is no contradiction between the encouragement of globalization and support for domestic products."

Critics of the free trade agreements point to the principle built in to them. Countries concede their right to protect their workers and products in order to enable capital to freely move to and from them. Or in other words, in order to gain investments from abroad, workers in Israel must be sacrificed. The prevalent phenomena in Israel of today, those about which the ministry of industry and trade is complaining - the firing of thousands of workers, the transfer of the work force to manpower companies and the drop in wages - are, according to this approach, the direct result of globalization, which the ministry enthusiastically encourages.

Dalia Itzik claims that "Israeli consumers must help the workers and support local industry," making it clear that "We must return to Israelis the values of mutual aid and national pride. I have no intention of apologizing for that. This is the only country that apologizes for encouraging the consumption of its own products."

But the minister declares in the same breath, "The policy of openness to international trade will continue. We have no control over the international situation." She even notes that she cannot "protect those sectors suffering over the long term - neither from the economic or security situations, simply because we have opened the market to competition."

For example, she says, there is no point in protecting the textile industry. "If I impose levies on imports, people will pay NIS 50 instead of 10 shekels for a shirt. I can keep ten thousand workers in jobs but I don't want to do that at the expense of the consumers."

"I must take a systemic approach," she says, without hesitation adding her Zionist message - "and I think that it is the right thing to return to the values that dominated us in the past, those of a shared destiny."